Reviewing more than one offer can be a complex process for sellers. The inclination is to consider only price, but that might be a mistake. There are a variety of different terms in an offer that sellers should consider in order to determine the best offer. This blog contains an overview of comparing multiple offers on Southern California properties

An Overview Of Comparing Multiple Offers On Southern California Properties

Loan Pre-Approvals

There is a significant difference between a pre-qualification and a pre-approval, particularly when comparing different offers. Pre-approvals are traditionally issued after a lender confirms credit scores for a borrower. A pre-qualification includes no kind of verification. Pre-approved buyers are, as a result, better positioned to obtain commitment on a loan. A borrower who does get a mortgage will back out of the purchase. The seller will then need to get a new buyer for the home. Due to this risk, sellers will not only want a pre-approved home buyer but should also read the specifics of pre-approval letters. The type of mortgage is another relevant factor because some types of loans have strict requirements on the borrower and property, or may take longer to complete.

Conditions

It is typical for contingencies such as a mortgage approval to be included in an offer. Buyers may also include additional rare terms, such as a a contingency on the sale of another home. Less conditions lead to a higher likelihood of closing. Some conditions are more troublesome than others and can be dependent upon the condition of the market.

Deposits

Deposits reflect the good faith of a home buyer. It also covers a home owner when the buyer terminating a deal for an unexpected reason. Lastly, the amount of earnest money may reflect financial strength. For the above reasons, the dollar value of deposits must be carefully considered in multiple offer scenarios.

Price is Relative

Home owners should avoid making price the only consideration when comparing more than one offer, especially if a fast closing is a concern. Issues along the way may be costly and therefore may impact the final figures. Additionally, a property that is re-listed after an offer falls through may sell for less due to loss of momentum. A skilled real estate broker will help you carefully review all the terms of contracts and properly compare them. This article with an overview of comparing multiple offers on Southern California properties was shared by Matthew Rapoport at Homes Inc..

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